Daniel Auf der Mauer for The New York Times
Bach concerts sponsored by the bank Wegelin were sometimes held at the St. Laurentius church in St. Gallen.
ST. GALLEN, Switzerland — Given the modest size of its offices, a trim neo-Classical building off the marketplace, it is easy to underestimate the imprint of the bank once called Wegelin on this compact Swiss city.
It is not just that it was the oldest bank in Switzerland, founded by local textile merchants in 1741. Its senior managing partner, Konrad Hummler, was the son of a former mayor, chairman of the board of the Neue Zürcher Zeitung, the Zurich daily that is the country’s leading newspaper, and the prolific author of columns in which he often denounced the business practices of bigger Swiss banks, like UBS.
But most important, Wegelin, which closed its doors this month, was a significant sponsor of cultural institutions in the area. Among its projects, in 2006 Mr. Hummler, a passionate music lover and amateur violinist, established the Johann Sebastian Bach Foundation, with the goal of financing the performance and recording of the entire vocal works of the German composer, more than 200 cantatas, a task expected to last more than 20 years.
Moreover, the bank was dedicated to preserving the architectural substance of the town. In 2007, Wegelin paid almost $2 million for a significant part of the late Gothic convent of St. Catherine, a former nunnery with a soaring chapel and vaulted cloister that was in considerable disrepair. It then underwrote a painstaking restoration of the chapel with its 19th-century organ, and other portions of the buildings. The idea was to use them eventually for performances of Bach’s works and other music.
The bank and Mr. Hummler also had close ties to the local business school, and at any given time several dozen students might be employed in its training programs.
Now, all this is jeopardized. Last year, Wegelin was charged in the United States with illegally helping American citizens avoid taxes. Under the shock of these charges, Wegelin was split up and its valuable assets placed with another local bank, Raiffeisen. Its bad assets remained with Wegelin, though its name was changed to Notenstein Privatbank, for a medieval guild in St. Gallen.
Wegelin executives eventually pleaded guilty before a court in New York to helping Americans avoid taxes on $1.2 billion of assets between 2002 and 2010, and agreed to pay restitution and fines of almost $60 million. Entering the plea, one of Mr. Hummler’s closest associates, Otto Bruderer, told the court that Wegelin had always believed it was in compliance with Swiss law, adding that “such conduct was common in the Swiss banking industry.”
The news shook St. Gallen. “It was extremely surprising,” said Leonie Schwendimann, who runs a small bookshop across from St. Laurentius, the Protestant church where Bach concerts sponsored by the bank are occasionally held.
Ms. Schwendimann, who often attended the concerts and was a friend of Rudolf Lutz, the baroque specialist who directed the series, voiced concern for their future. “It would be a great loss,” she said. Of the bank’s disappearance, she added, “You have to take care of your business.”
It seemed only coincidental that posters around town advertised the latest piece at the town theater, a sharp critique of the financial world by the Swiss playwright Urs Widmer titled “The End of Money,” featuring a full-length photograph of a banker with donkey’s ears.
Madeleine Herzog, responsible for culture in the city government, called the bank’s restoration of St. Catherine’s convent “exemplary.” But she was concerned about the future without Wegelin. “It was planned for the buildings to be used for cultural events, but that lies now in the responsibility of the bank’s new owners,” she said. “What their concrete plans are, what the future of the Bach cycle is,” she said, “that is not known.”
St. Gallen Journal: Swiss City Fears for Cultural Legacy in Wake of a Bank’s Fall
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St. Gallen Journal: Swiss City Fears for Cultural Legacy in Wake of a Bank’s Fall
